In the spring of last year, Xi Jinping – China’s paramount leader – presided over a national conference on religion. He seized the opportunity to declare Chinese Communist party (CCP) authority over questions of faith. Religious matters, Xi announced, are of “special importance” to the CCP: “We should guide and educate the religious circle and their followers with the socialist core values.” Believers must “dig deep into doctrines and canons that are in line with social harmony and progress, and favourable for the building of a healthy and civilised society, and interpret religious doctrines in a way that is conducive to modern China’s progress and in line with our excellent traditional culture”. Members of the CCP, he further emphasised, must remain “unyielding Marxist atheists, consolidate their faith, and bear in mind the party’s tenets”.

Xi’s remarks exemplified the fierce tensions that surround the past and present role of religion in communist China. While the party acknowledges and accepts the resurgence of religious belief made possible by the post-Mao thaw, it retains an ongoing compulsion to regulate faith – a compulsion that has resulted in violent suppressions of spiritual movements such as Falun Gong.

While the party accepts the resurgence of religious belief, it retains an ongoing compulsion to regulate faith

In his fascinating odyssey through contemporary Chinese religion, Ian Johnson uncovers the roots of these tensions, and the contradictory, complex face of religion in China today. He begins by describing the interlocking relations in pre-20th-century China between politics, society and multiple faiths. In the west, he argues, we are accustomed to thinking “in exclusive terms: this person is Catholic, that person is Jewish, another is Muslim. These faiths have … set places of worship, a holy book and, quite often, a clergy.” In pre-modern China, religious attachment lacked this absoluteness: believers veered between the “three teachings” (Confucianism, Buddhism, Taoism) according to social and ritual need. Religion blurred ubiquitously into political power. Control of local temples and religious practices gave local bigwigs community clout; religious authority constituted the “lifeblood” of imperial rule. “The emperor was the ‘Son of Heaven’, who presided over elaborate rituals that underscored his semi-divine nature.”

Religion’s saturation of political life made it an obvious target for reformers and revolutionaries discontented with a China torn apart by foreign enemies and domestic rebels. In searching for the roots of the country’s crises, many early 20th-century radicals blamed religious tradition – particularly but not only Confucianism – for holding China back from becoming a cohesive, modern state populated by rational, dynamic citizens. This antagonism towards religious tradition peaked during the Mao years (1949-76): temples and monasteries were destroyed; clergy were beaten, imprisoned and killed; Christians were automatically suspect as adherents of a “western” faith. (The religious impulse, of course, did not disappear through these decades: especially from the 1960s onwards, Mao was worshipped as an infallible deity.)

‘A communist temple saturated with legitimising ritual symbols’ … a military band rehearses in the Great Hall of the People in Beijing. Photograph: Ng Han Guan/AP

Yet religion has made a striking comeback since intense political repression eased after Mao’s death. A survey carried out in 2005 by one of China’s top universities revealed that almost a third of the population (some 300 million people) subscribe in some way to a faith: mainly Buddhism, Taoism, folk religion or Christianity. But the party remains deeply ambivalent about China’s religious turn. “Traditional values and practices are encouraged as a source of stability and morality,” Johnson writes. “But faith is also feared as an uncontrollable force – an alternative ideology to the government’s vision of how society should be run.”

Johnson produces a nuanced portrait of citizens striving for non-material answers in an era of frenetic materialism

His book features an ensemble cast of believers, and follows the rhythms of the traditional Chinese lunar year. Johnson spends weeks with Taoist musicians, whose ritual performances bring the deceased “over to the other side”. He attends an unregistered Christian church in western China that challenges the party’s claim to be moral arbiter of society. He dines with celebrity Zen Buddhists, who dispense wisdom to real estate developers, the offspring of party aristocracy, executives and bank managers. He practises qigong – religious breathing exercises and meditation – with a master in an apartment block reserved for once-persecuted party elders rehabilitated after Mao’s death. With nicely understated irony, Johnson weaves the political rituals of the self-proclaimed atheistic CCP through this calendar: its conferences held in the Great Hall of the People, a communist temple saturated with legitimising ritual symbols; the intensely ritualistic departures and ascensions of communist leaders. “Like a Taoist priest,” he observes of Hu Jintao anointing a successor at the 18th party congress in November 2012, “Hu emulated an immortal … dyeing his hair jet-black to make himself look ageless, and surrounding himself with propaganda banners conferring immortality on the Communist party.”

The book is full of moving encounters with Chinese citizens struggling to find the “lost middle” of the country known as Middle Kingdom: funeral-goers wondering “Why are we here?”; civil rights lawyers and bloggers inspired by the spiritual independence of Chinese Christians; a Taoist functionary too overworked by clients clamouring for his spiritual services to stay connected with his 11-year-old son. At the winter solstice, many fall prey to apocalyptic imaginings from which, as ever in China, some try to make a buck: “A Beijing office worker constructed what he said was a cataclysm-proof bunker high up on the Tibetan plateau with an $8,000 entry fee.”

By the close of his lunar year, Johnson succeeds in having produced a nuanced group portrait of Chinese citizens striving for non-material answers in an era of frenetic materialism. All the while, they are overseen by an uneasy Communist party striving both to control spiritual life and to boost its legitimacy by hijacking some of the rhetoric and ritual of China’s old political-religious empire.

•The Souls of China: The Return of Religion After Mao is published by Allen Lane. To order a copy for £21.25 (RRP £25) go to bookshop.theguardian.com or call 0330 333 6846. Free UK p&p over £10, online orders only. Phone orders min p&p of £1.99.